The Rockefeller Foundation

Dr. Rajiv Shah of the Rockefeller Foundation and his new book, Big Bets

America’s biggest foundations wield power. They deserve scrutiny, which is why I like to report on what they do and how they do it. 

And yet. These billion-dollar institutions are so lacking in accountability that it’s not clear to me that critical journalism about foundations can make a difference. So I wonder whether it’s worth my time and trouble to write about their work.

This month, the Chronicle of Philanthropy published a pair of stories that I wrote about the Rockefeller Foundation, which held an endowment of nearly $8 billion at the end of 2021. No Apologies: Rajiv Shah Stands Behind Rockefeller’s Top-Down Approach looks at the foundation’s strategy, which cuts against the grain of much of today’s liberal philanthropy. Rockefeller loves grand initiatives and relies heavily on experts, holding onto power for itself and asking the nonprofits that it funds to carry out its goals.

For what it’s worth, this strategic top-down approach, when done right, can be effective. Rockefeller’s history demonstrates that; it helped develop the yellow-fever vaccine and drove the Green Revolution. I’m an admirer of Open Philanthropy, Arnold Ventures and the Gates Foundation, all of which favor a top-down approach.

The alternative is the philanthropy of MacKenzie Scott, who has donated more than $14 billion to about 1,600 nonprofits, with no-strings attached, to “use as they see fit,” she says. The Ford Foundation, with its BUILD program, also shares power as well as money with the nonprofits it supports.

My second Chronicle story, headlined Rockefeller’s Rajiv Shah: Highest Paid CEO Among Big Foundations, asks why Shah is paid nearly $1.7 million a year. That’s substantially more than any other leader of a major foundation, although at least a dozen foundations including Gates, Ford, Lilly, Hewlett and Packard have bigger endowments and give away more money than does Rockefeller. Shah’s track record at Rockefeller has been spotty, with some wins and some losses, but he appears to have the full support of his board of trustees. He has been good to them—earlier this year, the trustees and their spouses were all invited to a board retreat at the Bellagio Center, a meeting place on the shore of Lake Como in Italy that is owned by Rockefeller. Nice work if you can get it.

Medium subsequently published my commentary under the headline, Raj Shah’s $1.7 million salary is a bit much. (The Chronicle stories are paywalled; this one is not.) Among other things, it reports on a previously-undisclosed complaint against Richard Parsons, the former CEO of Time Warner and board chair of Citigroup, who as chair of the Rockefeller Foundation was accused of having an improper relationship with a young, female staff member. The foundation investigated, as it should have, hiring the New York law firm of Paul Weiss to look into the matter, at a cost of $1.7 million. But it never disclosed the complaint against Parsons and will say almost nothing about the results of the investigation; that’s as good an example of any of the foundation’s lack of accountability.

Now Rockefeller is putting its marketing muscle behind Shah’s new book, Big Bets. The foundation is even paying for a video billboard in Times Square. Proceeds from book sales flow back to Rockefeller but surely there are better ways to spend the foundation’s money. It’s all too easy, alas, for the board and staff to spend money with no one keeping watch on what they do.

This billboard was paid for by Nasdaq, for some reason. Rockefeller bought one, too.

Reporting on foundations is challenging. They are very slow to publish their tax returns, which list their contributions, and they have no obligation to explain how they spend money on their own operations and administration. Rockefeller spent about $1 on itself for every $3.17 it pushed out the door in 2021, more on a percentage basis than any other big foundation, partly because it relies heavily on its staff and consultants to do the work that other donors farm out to nonprofits.

The other difficulty in reporting on foundations is that most people who know anything about them are reluctant to talk. They are either funded by their foundation grants, or would like to be. The culture of philanthropy is terribly polite.

I hope my reporting on Rockefeller gets the attention of its trustees. I can’t say I’m optimistic. There’s no scandal at the foundation, just a lot of money flowing around in ways that don’t do as much good as it should. So I will continue to wonder whether my time and effort is better spent elsewhere.